By Liz Moyer

Investing.com — U.S. oil stockpiles declined far more than expected in the latest week, the Energy Information Administration said on Wednesday.

inventories fell 876,000 barrels last week, compared with analysts’ expectations for a build of 107,000 barrels.

“At a glance, this is an endorsement of the ‘U.S.-demand comeback’ story, given the surprise crude draw that’s eight times more than the expected build,” said Investing.com analyst Barani Krishnan. 

stockpiles, which include diesel and , rose 2.54 million barrels in the week against expectations for a build of 171,000 barrels, the EIA data showed.

were 522,000 barrels. The weekly improved by 2.3%, according to the EIA report.

inventories declined 1.735 million barrels last week the EIA said, compared with expectations for a 730,000-barrel build.

“Most encouraging to oil bulls will be the heady gasoline demand that came in at a million barrels above the forecast draw.,” Krishnan added. “Also, refinery utilization continues to head for seasonal norms, with runs at almost 84% of operable capacity versus the previous week’s level of just above 81.5%. The cherry on the cake, again for the longs, will be exports returning to above the 3-million-barrel per day mark.”

Krishnan noted the report isn’t without its negatives.

“The most disconcerting would be U.S. crude production, which the EIA revised upwards to 11.1 million barrels per day, he said.

“While that’s just a modest 100,000 barrels above the previous week, it bears watching — if you’ll pardon the pun — as more drilling rigs are being put to work each week, with WTI steadily hovering at $60 per barrel. The is the industry’s way of measuring future production. As of last Friday, it stood at 324, up 180 or 73% from the August record low of 244.”

“The other, of course, is distillate inventories growing by 800,000 barrels above estimates. That’s an indication that sans gasoline, demand for other transportation fuels is still anemic.”